If you are experiencing longer than usual wait times for delivery of your new iPhone 13, it is safe to blame it on the huge supply chain constraints being faced by Apple in China. While it was already known that Apple was having a tough time meeting its 2021 iPhone production targets, a new report by Nikkei-Asia Reveals the real extent of the problem.
According to the report, for the first time in more than a decade, Apple was forced to halt production of iPhones at several of its contractor-run plants in China in October 2021. Unfortunately for Apple, these measures were taken around the same time. The company usually ramps up production in the November-December period to meet the increase in demand for iPhones.
The supply chain manager at one of the plants revealed that these manufacturing facilities usually move to a 24-hour production schedule in October, with workers getting additional shifts. This time, however, workers were finding time to coincide with the Chinese Golden Holiday season. He said it didn’t make sense for him to work overtime when chips and components were in short supply. Workers would also have to pay extra for the overtime hours they put in. He said that this had never happened before.
The report cites several reasons for the supply chain crisis, mainly unexpected power restriction imposed by China after the energy crisis in September and October. While Apple did not face problems in sourcing critical components such as processors and modems, it is the availability of smaller components that has led to the current crisis. Some of the components in short supply include power management chips from Texas Instruments, transceivers from Nexperia, and connectivity chips from Broadcom. Many of these components are made in countries like Malaysia and Vietnam, which have also been affected by the COVID-19 induced lockdown.
These constraints caused Apple to lower its iPhone production estimates for 2021. The company was initially expected to make around 95 million iPhones in 2021, which has now been reduced to 85 million units from around 83 million. Apple has already indicated that the current supply chain crisis should subside soon, and production activity should return to normal by the first quarter of 2022.